Chartbook: March 6
Slides from this week’s internal trading call:
CAD
Currencies Stabilize As Pivotal Week Begins
Investors are bracing for a momentous week, with Jerome Powell’s Congressional testimony, three major central bank meetings, and the February non-farm payrolls report combining to set the stage for erratic price action in currency markets. The dollar is climbing, yields are ticking lower, and the euro and pound are tightly rangebound. Commodity-linked currencies sold off over the weekend as China’s leadership unveiled a more cautious growth agenda than had been expected. Work documents released during the National Party Congress outlined plans to increase state outlays and expand the budget deficit, but Beijing set its headline gross domestic product target at...
Markets Rally on Mixed Fed Messaging
Markets are preparing to build on yesterday’s rally with further gains in today’s session. Equity futures are setting up for a stronger open, Treasury yields are lower across the curve, and commodity prices are up. The dollar is lower against all of its major counterparts. Media commentary yesterday suggested markets moved higher on dovish messaging from the Atlanta Fed’s (non voting) Raphael Bostic during a panel discussion hosted by the National Association for Business Economics – but we’re struggling to see evidence of a clear shift in positioning. Bostic did seem to anchor terminal rate expectations lower than market-implied levels...
China Reopening Hopes Lift Markets
March is coming in like a lion, with risk appetite rebounding across asset classes on evidence of a stronger-than-expected recovery in the Chinese economy. The US dollar is in retreat as investors pile into the euro on hopes for stronger exports, and as they buy emerging market currencies on an expected rise in raw materials demand. Major North American equity bourses are setting up for a stronger open even as Treasury yields tick higher. The Canadian dollar is gaining, but continues to lag a broader improvement in the commodity complex. The China reopening trade roared back to life last night...
Chartbook: February 27
Slides from this week’s internal trading call: